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tv   Meet the Press  MSNBC  February 7, 2010 2:00pm-3:00pm EST

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to the public as a result of the explosion. we have reports that effects of that explosion were felt as far as 20 mimsles away. search and rescue operations are under way. >> we're in a search and rescue mode. the fire is out in the building. the building was not leveled. the building was pretty heavily damaged on the back side, and right now we're in the search and rescue mode and we're going from there. >> the cause of the explosion is not known at this time, but our local nbc station wvit is reporting that the main plant building was severely damaged. some say leveled in the explosion. this is a natural gas-fueled power plant but the manager says it was not supplying electricity to anybody yet as it was under construction. it was scheduled to come online in june of this year. again, repeating our breaking news, we have now confirmed two are dead and an unknown number of injured after an explosion at a power plant that was under
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construction near middletown, connecticut. once again, the fire in the area has been put out. we are told this is not a danger to the public today. a search and rescue operation is under way. we're told a number of people have been taken by ambulance and air lifted to the hospital. more news later as it comes into us here at msnbc. but right now let's go to "meet the press." from nbc news in washington, this is "meet the press" with david gregory. this sunday, two major threats facing the u.s. terrorism and recession. the country's top intelligence officials warn that al qaeda will attempt another attack against america within months. as the administration is under fire for its handling of terror
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suspects. making national security a top campaign issue this year. our guest this morning, the president's top counterterrorism adviser john brennan. then, the economy. a puzzling jobs report features a dip in the unemployment rate below 10%, but where are the jobs? and are deficits as far as the eye can see undermining america's power and influence in the world? our exclusive guest this morning discusses the present and the future of the u.s. economy. former treasury secretary and author of the new book "on the brink," henry paulson. and former chairman of the federal reserve alan greenspan. finally, your politics fix. sarah palin rallies the tea parties saturday night. >> we need a commander in chief, not a professor of law standing at the lectern. >> scott brown is sworn in as the 41st gop senator. what now for the obama agenda? a jobs bill, financial regulation, and health care. with us two former white house
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insiders, counselor to president george w. bush ed gillespie and press sergeant to president bill clinton, dee dee myers. but first you can call it the winter of washington, d.c.'s discontent. the city at virtual stand still this weekend. nearly 20 inches of snow in the district. more than 30 inches in the outlying areas. president obama braved the blizzard heading just a few blocks north of the white house to address the democratic national committee meeting. snowmageddon in d.c. >> others are calling it the snowpocalypse. d.c. is digging out from this massive storm hoping to get back to normal and back to works on health care, a jobs bill, and the difficult task of battling terrorism. here is the president's top
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terror adviser john brennan. welcome back and thank you for braving the elements to get here this morning. >> thank you, david. >> very serious topic to discuss. the president was at the cia marking those who have fallen recently with the agency, and he spoke about the war in afghanistan to hundreds of employees urging them to complete the mission and win the war. how does he define winning? >> the visit to cia headquarters was a poignant and somber reminder of exactly how determined the intelligence community and the u.s. government is to destroy al qaeda. and as we move forward in afghanistan and pakistan and other areas, we are determined to destroy al qaeda, the organization. they have used areas of pakistan and afghanistan to ply their trade and train their operatives, and we are moving forward in cooperation with the governments to take away that safe haven. >> we are up against a very
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difficult threat as was underlined during testimony in front of the intelligence committee this week. this is a portion of that questioning. >> what is the likelihood of another terrorist attempted attack on the u.s. homeland in the next three to six months? high or low? director blair? >> an attempted attack, the priority is certain i would say. >> mr. panetta? >> i would agree with that. >> mr. muller. >> agree. >> general? >> yes, ma'am, agree. mr. dinger, yes. >> first off, what can you say about the intelligence that's behind such a specific warning like that? >> ever since 9/11 al qaeda and bin laden have been determined to follow through on its earlier attacks here in the homeland. we have disrupted numerous attempts to carry out those attacks here. they are continuing to train those operatives. they are using different areas of the world. we see most recently that yemen has become an area where al qaeda and the arabian peninsula
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is attempting to launch those attacks. the intelligence is strong they are continuing to focus on the homeland, but at the same time our counterterrorism successes take place every day. it shouldn't have come as a surprise to anybody that al qaeda is attempting to carry out an attack. they continue to have that as one of their priorities. >> and how do you win against a threat like this when cia director panetta was saying al qaeda is adapting its methods in ways had that are often difficult to detect? >> we have to stay more than one step ahead of al qaeda and i think we have been able to do that. we have increased our security capabilities across the board. we're working very closely with our partners. they are looking at new technologies. we're enhancing our screening procedures in the aviation sector and other areas. we're continuing to look at the types of developments and evolution they are going through so we can thwart those attacks and they have been very, very successful. >> they credible threats against the super bowl today? >> not that i am aware of. no, not at all.
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people are very comfortable with the security measures that are put in place for the super bowl. >> what kinds of attacks is al qaeda now interested in pulling off? >> well, i think the abdulmutallab attempt is a reflection of how difficult it is for al qaeda to carry out attacks. he had a device in his underwear. it was a faulty device and because they're unable to carry out these large scale attacks, they're now opting for individual operatives to carry out smaller scale attacks. they recognize they are in need of some type of demonstration of their capability that they have not been able to show because of the tremendous work across the board, not just here in the united states between law enforcement and intelligence, but with our partners, with our pakistani, saudi, yemeni partners. this is going well in terms of continuing to keep the pressure on al qaeda. >> how worried are you about sleeper cells in pulling off a single rather than a home run,
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whether it's attacking a shopping mall or this kind of attack? >> that's why we have over 100 joint terrorism task forces the fbi runs throughout the united states to make sure we have eyes and ears throughout this country in the event there are some sleeper cell that is are out there. very close collaboration between the fbi and local law enforcement. we have been able to stop individuals, najee bul zazi, sleeper cells are something we're concerned about but we have dedicated a lot of resources to uncover them. >> let's talk about this political fight over national security as well. scott brown now the 41st republican senator. on the night he was -- of his victory when he was celebrating, he said this about the approach of the administration. >> and the message we need to send in dealing with terrorists, our tax dollars, our tax dollars should pay for weapons to stop them and not lawyers to defend them. >> a lot of that criticism is
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about the handling of the christmas day bomber abdul -- abdulmutallab. why was he treated as on ordinary citizen even for the period of time he was. providing some information and getting a lawyer. >> he wasn't treated as be a ordinary citizen. he was immediately taken into custody. he was questioned under the public safety exception as far as mirandizing an individual. fbi agents were there on the ground as well as with customs and border parole agents. we reacted very well to that situation. he was then put into a process that has been the same process that we have used for every other terrorist who has been captured on our soil whether they be u.s. citizens or nonu.s. citizens, richard reid, they were brought into custody by law enforcement officials and treated accordingly. so there was no distinction, and, in fact, the fbi's
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guidelines they use was the implementation of the attorney general guidelines that were finalized by attorney general casey in the last administration in december of 2008. that is when those guidelines were put in place. so the procedures and the protocols were exactly consistent with what we've done before. now, after this incident the president asked us to take a new look and see whether or not those processes are ones we're comfortable with and whether we can enhance and strengthen them. that's what we're looking at right now. but those fbi agents and others acted appropriately and i'm tiring of politicians using national security issues such as terrorism as a political football. they are going out there, they're unknowing of the facts and they're making charges and allegations that are not anchored in reality. >> senator kit bond saying that members of the intelligence committee were told not to talk at all about the fact that he was now cooperating and that he was speaking to the fbi and it gets leaked out to the press after that saying that the administration was responsible for leaking classified data,
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that they were told to keep under wraps. >> inconsistent with the facts. senator bond and other senior members of congress were briefed on monday about abdulmutallab's cooperation. they were told of the fact of that cooperation and some of the information they were sharing. during the subsequent day it came out that that intelligence was starting to flow from mr. abdulmutallab. the press was all on it. this network went out right away and reported that and so we then wanted to make sure that we were able to provide to the networks and to the media the correct rendition of what happened and how instrumental mr. abdulmutallab's family was in getting him to cooperate, and it was a very successful activity on the part of the fbi, department of justice, and others, including the intelligence community. so what we did was make sure the facts were out there as best they could be. >> to those who say you have not shared enough information about how you intended to handle him, you say what? >> i say that there are sensitive investigations and operations under way and we're
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not going to compromise our ability to follow up on that information and to disrupt further terrorist attacks, and there have been instances when information has been shared with the hill, when we see it in the media the next day, and we have to be circumspect as far as what information is going to be shared. the premium this president puts on the work of the intelligence and law enforcement community is to disresult future attacks -- jo when you brief some republicans about how he was going to be treated, were they on board with the administration's decision? >> on christmas night i called a number of senior members of congress. i spoke to senators mcconnell and bond. i spoke to representative boehner and hoekstra. i explained he was in fbi custody, mr. abdulmutallab was in fact talking, cooperating at that point. they knew that in fbi custody means there's a process you follow as far as mirandizing and presenting him in front of a magistrate. none of those individuals raised any concerns. they didn't say is he going into military custody?
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is he going to be mirandized? they were appreciative of the information. we told them we'd keep them informed. there's been an outcry after the fact where i'm just very concerned on behalf of the counterterrorism professionals about our government that politicians continue to make this a political football footb. in the last administration democrats i felt were speaking incorrectly about the progress we were making on the terrorism front. same thing is true today. i think the professionals deserve the support of our congress and rather than second guessing what they're doing on the ground with a 500 mile screwdriver from washington to detroit, i think they have to have confidence in the knowledge and the experience of these counterterrorism professionals. >> through that questioning, what are you learning about al qaeda specifically in yemen? >> we have known for a while that al qaeda in the arabian peninsula, which was a merger of al qaeda in yemen and saudi arabia, had a number of senior
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operatives and individuals who are associated with osama bin laden in the past. their focus had been on carrying out attacks in yemen against our embassy, about a year and a half ago, in saudi arabia an attempted assassination against the senior counterterrorism official within the saudi government. that's where their focus was. what we are now learning is this they have been determined because of individuals who have been speaking out, focusing on trying to carry out those attacks in the west, including in the homeland, and we have had excellent cooperation from the yemeni government. we're continuing to work very closely, and we believe we're now ahead of this curve. >> let me spend a couple minutes on the proposed civilian trial of khalid shaikh mohammed. if not in new york, then where? >> we have to remember that the priority is to bring this murderer to justice. that's what the victims of 9/11 and their families deserve. clearly, we have to take into account the concern that is have been expressed by the state and city of new york as well as the sentiments of the congress, but we are determined to bring him to justice. we are working with with those individuals within congress who
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are responsibly dealing with the situation so we can find the venue and making sure that we are able to move forward as quickly as possible. this individual deserves the full weight of american justice. >> the attorney general has said failure is not an option in this case. do you have any doubt in your mind he will ultimately be executed by the united states? >> i have no doubt the american justice system will prevail despite the claims and criticisms of a lot of folks that our judicial system is unable to handle that's terrorists. i believe our system of justice is strong and hooim not going to give al qaeda the victory of being able to overturn our system of jurisprudence here that's anchored in constitution and reflects our values as a people. >> are you confident he'll be executed? >> i'm confident he will have the full weight of american justice? >> he getting all the due process? is this really the shining example of american jurisprudence? >> it's going to be the shining example when he is brought to
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justice, and i'm convinced and confident that mr. khalid shaikh mohammed will meet his day in justice and before his maker. >> and my remaining couple minutes i want to ask you about china and the espionage threat. china has a robust espionage program against the united states. we have seen what's taken place with google pulling up stakes. dennis blair said the attack on google's servers were a wake up call. how serious is this threat from china? >> the threats and the vulnerabilities within the cyber domain are serious and significant. that's why president obama has made it a primary focus of this administration. we now have a cyber security on board within the white house. howard schmidt, we're looking at these issues from the standpoint of espionage, from governments, from different individuals whether they be hackers or terrorist organizations. the opportunities to create
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problems within the cyber sphere are significant, and this government is taking steps. it's a very complex and complicated challenge, but we're working very closely with the private sector. we're working very closely with the different instruments of government as well as our foreign partners. >> is national security at risk here? >> national security is something that is at risk. that's why what we're trying to do is ensure our networks have the ability to withstand these attempts to hack in and to conduct activities whether it's stealing intellectual property rights or steal government skrekts secrets or cause problems or steal one's identity. that's why this is a shared responsibility. >> we will leave it there. mr. brennan, thank you very much. coming next, the economy. a puzzling jobs report and mounting deficits. when will the recession be over? our exclusive interview with former treasury secretary henry paulson and former chairman of the federal reserve alan greenspan. plus our round table delves into
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we're back and joined by henry paulson and alan greenspan. welcome both of you back to "meet the press." dr. greenspan, here was the headline in the "new york times" yesterday. jobless rate falls to 9.7% giving hope that the worst is over. does this jobs report signal a
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turnaround? >> it doesn't signal a turnaround, but what it does say is that a turnaround which has already occurred is moving but not in any aggressive manner. >> and, secretary paulson, if you look at the jobs loss since the recession began, 8.4 million jobs over that time horizon. the question is what's going to cause a turnaround? when do you see this jobless rate actually stay in the single digits? >> well, the economy is clearly recovering, and i have great confidence that we have such a dynamic private sector in this country that they're eventually going to begin creating jobs. now, one of the factors, not the only factor, but one of the factors that will help is more certainty with regard to actions out of washington.
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and, for instance, certainty with regard to financial regulatory reform will help. >> in terms of not just regulatory reform, which we'll talk about, dr. greenspan, but also just the idea of the notion of what the government can do now with regard to a jobs bill or other things to bring down unemployment more steadily. >> i think we have to start with the focus of economic activity. in other words, jobs are created by having something to do. you see, you can't put jobs before economic activity, and i would, therefore, argue what would be most useful at this particular stage is cutting taxes on small business because they are the big creator of jobs, but they won't hire anybody if they don't have any business. so you have to get them to act in a manner which creates the types of economic activity which draw in an ever increasing
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demand for labor. >> that a question in terms of what's happening out there. where the impetus for businesses to start hiring again? >> well, again, i just believe so much in how dynamic our economic system is and our economy is. the one thing i know for sure is with the economy recovering, ultimately the private sector will do what needs to be done and create opportunities and jobs. i agree with alan that when you look at a jobs bill, the sorts of things that congress should be focusing on are temporary incentives for business to hire. >> and yet is that enough? if there's not a business willing to take the risk to expand? >> well, again, as i said earlier, part of it is confidence and psychology, what's going on inside the head of the ceo and how comfortable
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does he or she feel about the future. but, again, it's very difficult to sit here and say, now, where is the economic activity going to come from? which area, which business? but it always does come, and it will come. we have stable financial markets and a recovering economy. it's going to take some time though. >> when is the recession over? >> the recession is over. it bottomed back in the middle of last year, and while it doesn't have the strong momentum i had hoped it would have, strangely because of the fact that we had such a strong fourth quarter which was essentially using up a lot of the latent power of advance which was the gradual reduction in the rate of decline in inventories. we did it all in the fourth quarter. and in a sense we shot our ammunition.
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so it's going to be a slow trudging thing, but i do think we're going to be moving forward, and as hank says, the issue here is basically innovation. innovation by definition is not forecastable. so we don't know where the jobs are coming from. we don't know how this market is exactly in terms of dynamics going to move forward, but we know that this process is under way and there's every reason to believe it will continue. >> and you look at the stock market, the fact it's been on a downward path for the past couple weeks, down over 6% since january. what kind of warning sign is that? >> well, it's more than a warning sign. it's important to remember that equity value, stock prices, are not just paper profits. they actually have a profoundly important impact on economic
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activity, and if stock prices start continuing down, i would get very concerned. >> i agree with that, but i also never place too much emphasis on what the market does for any week or two. you need to really look at this just like you look at economic data over a period of time, and if you look at this over a reasonable period of time, we've seen a very solid stock market. >> let me ask you about the president and about the president's team. this is something you wrote in your new book "on the brink" about election night and a change in leadership. after the democratic candidate was declared the winner at 11:00 p.m., wendy woke me up to tell me the historic news. i went back to sleep comforted by the knowledge that our president-elect fully understood the threat our economy still faced. what do you say now after more than a year ? is that confidence still high in
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he and his team. >> what i say is this, i take real comfort in the fact that the programs that were put in place to stabilize the economy were continued and much of what has been done has been a continuation or a logical extension of those programs. i believe the financial markets are stable. i believe the programs have worked. they prevented the collapse of the financial markets. prevented a real catastrophe. i think we could have had 25% unemployment if the system had collapsed, and i believe that we're going to see that every penny that's been put in the banks is going to come back with interest. so i think the money is coming back. and that was what i was talking about on election eve because both presidential candidates had supported the t.a.r.p. legislation, and i think that was critical.
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if they hadn't, we would have been defenseless. >> but you certainly seemed impressed reading your book with candidate obama. frankly, more so than senator mccain. did you vote for obama? >> well, who i voted for is between me and the voting booth, but there's -- i was very impressed that candidate obama was very concerned with what was going on and was very supportive. candidate mccain i will admit gave me a few more anxious days and hours, but i will also say that as he was falling behind in the polls, it would have been very easy for him to demagogue that issue, play the populist card. if he had come out against what we were trying to do, we wouldn't have got it, i believe. we wouldn't have had the t.a.r.p. legislation passed. >> dr. greenspan, one more question about jobs. do you think the unemployment rate goes up again before it comes down?
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>> i'm not sure. one of the reasons is the official data on unemployment is a sample, and it fluctuates, and as we observed in the january report, it literally took it seriously as to the exact numbers. there are 784,000 job increase in january. now, that didn't happen. so what we can expect is a backing in february. i think we're going to stay at approximately the 9% to 10% level for a goodly part of the rest of the year with the sole exception of that period when they start to hire very large number of census workers. and that's going to have some positive effect, but it's very difficult to make the case that unemployment is coming down anytime soon. >> let me ask you about housing. a disturbing report on wednesday in "the new york times" talked
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about people under water in their mortgages. the number of americans, the paper reported, who owed more than their homes was worth was virtually nil when the real estate collapse began in 2006, but the third quarter 2009 an estimated 4.5 million homeowners have reached the critical threshold with their home's value dropping below 75% of the hort gage balance. we are now at the paint of maximum vulnerability said sam khate re.. people's emotional attachment to their property is melting into the air. secretary paulson, what happens if housing prices go down again when you've already got this kind of precarious situation? >> it clearly wouldn't be good. i'm knottnot predicting that, b think this issue is a critically important one because it's very difficult for governments to design a program that is going
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to be effective and going to be fair to taxpayers, a program to keep people in their homes if they don't want to stay in their homes. and so a big part of what we focused on was bringing the private sector together to keep those into their homes that can afford to stay in the homes and want to stay there. now, when you look at the crisis, i think part of the reason that so many experts and so many people didn't foresee housing as being the cause and count me among those, was that if you look our country since world war ii, residential housing prices have generally gone up. we haven't had nationwide declines and mortgages have generally been perceived to be safe investments. and so when you get the kind of decline we've had in housing prices, that it really destroys wealth across the country, but
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it also changes behavior. because historically everyone that had a mortgage would claw, fight, do whatever it took to make the mortgage payment and avoid default. and, of course, when the home is worth less than the mortgage, the haters tend to change. >> what do you see? >> well, i'm very much concerned if home prices decline from here. i don't think they're going to. in other words, they seem to be bottoming out. the reason i am is that during 2005 and 2006 as i recall there were 8 million home purchases with so-called conventional conforming mortgages with a 20% down payment. that down payment is gone, and we have this very large bloc of homeowners who are right on the edge of tilting down into that underwater category.
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fortunately, the evidence suggests that the vast majority, as hank was implying, of these types of homeowners, that is those with the standard conventional mortgages, do continue to pay on their mortgages even if the value of the home is below the market pri price. what worries me particularly is that there is a very large bloc that will be thrown on the market, people starting to foreclosure if prices go down significantly from here. >> let me move on. i want to talk about the deficit and i also want to talk about taxes. here are the deficit projections from the president's 2011 budget and the numbers are frankly staggering. if you look at the deficit for 2010, $1.56 trillion and through 2015 they estimate it comes down with $751.9 billion.
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how serious is this secretary paulson, assuming also the ten-year projections are often wrong? >> i just have no doubt that it is by far the most serious long-term challenge we as a nation face. all these other issues, economic issues, areminor compared to that. and it's a generational issue because there's no way we're going to deal effectively with the deficit without reforming the entitlement programs, medicare, medicaid, social security. and it doesn't have to be a crisis. this is something that can be handled, but one of the things that i talk about in my book, one of the lessons that just hit
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me right between the eyes being in washington is it's very, very difficult to get congress to act on anything that's big and difficult and controversial if there's not an immediate crisis, and so what it's going to take to get leaders on both sides to come together and deal with this i think is a huge question. >> and dr. greenspan, larry somers has said in the post, he asked a very provocative question, which is how long can the world's biggest borrower remain the world's biggest power? >> not indefinitely because there's no doubt that if the united states continues down the road that hank has been correctly identifying, we're going to find that our ability to borrow is going to get restrained because throughout our history we have always maintained a capital cushion, a
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cushion between our borrowing capacity on the one hand and the level of debt on the other. that is beginning to shrink. and if we get to the point where we're having difficulty selling our security, our treasury issues, then interest rates begin to move, and our ability to move internationally to essentially be the major currency, the major economy, the major economic power in the world is significantly diminished. history tells us that great powers when they've gotten into very significant fiscal problems have ceased to be great powers. >> the part of the fix here according to the budget has to do with the issue of taxes. here is how "the wall street journal" put it in the headline on tuesday and that is that the wealthy face a tax increase. those bush era tax cuts are going to be allowed to expire by this administration. secretary paulson, is that a bad
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idea? >> here is how i look at taxes. i believe what we need is broad-based tax reform, and the kind of tax reform where there doesn't discourage investments and savings, there are incentives for those. right now we have a tax system that is biased toward consumption. and we as a people save too little, invest too little, borrow too much. so i would like to see wholesale, broad-based tax reform, and i think that's clearly got -- >> my question is whether the bush tax cuts expiring is a bad idea? >> well, i have got to say anything right now that is going to in effect be a tax increase
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has got to be questioned, and an expiring tax cut is a tax increase, but i'm going beyond that because i really do believe that we are going to need a -- to take a different approach to a number of things, taxes being one of them, housing policies being another. >> dr. greenspan, the tax cuts? >> i agree with what hank is saying. i think the thing that disturbed me most in the last week or two was when the discussion was involved i believe in the senate on the issue of forming a commission, a congressionally authorized commission, as i read it there was a 97-0 vote to exclude social security from the deliberations of that commission. that said to me that we have
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gotten to the point in this country where spending is untouchable. i have no doubt that we have to raise taxes in order to close this huge deficit. but we cannot do it wholly on the tax side because that would significantly erode the growth in the economy and the tax base and the revenues that would be achieved would be far less than anybody expects. we have to recognize the fact that one of the things that we have to do, as tough as it's going to be, is that benefits are going to have to be pared in conjunction with tax increases to resolve this very serious, long-term budget problem. >> our remaining moment, secretary paulson, i have to ask you about financial regulation, about bonuses on wall street. do you see real changes happening on wall street? are you frustrated by the level of bonuses we're seeing? >> well, you ask two questions,
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and so, firstly, there's no doubt that compensation on wall street i think is out of whack and been out of whack for some time, and i understand why the american people are unhappy because, you know, in our system we expect those that take risks to really bare their own losses. but i would like to see that frustration, that anger, channeled toward regulatory reform, and i just think that's very, very critical. and to me one thing that is absolutely essential is that we get strong resolution authority so that in the future any type of financial institution when it faces failure that it is liquidated and liquidated in a way in which the taxpayer is not going to have to come in again
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and prop up or bail out a financial institution. >> all right. we will leave it there, but before i let you go, here is the picture of you back in the playing days at dartmouth. we have a couple football fans because i know dr. greenspan, you are, too, super bowl picks. >> imgoing to go with indiana and peyton manning. >> okay. >> it's very difficult to go against peyton manning. >> my view as well. we'll make that the last word. we'll continue our discussion with secretary paul son and ask him some questions the viewers have submitted via e-mail and twitter. you can also read an excerpt from his book "inside the brink" plus look for updates from me throughout the week all on our website mtp.msnbc.com. up next sarah palin. our round table, ed gillespie and dee dee myers are here only
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we are back joined by ed gillespie and dee dee myers. welcome both of you. "the politics fix" at the end of the program. so big news this weekend besides the snowstorm here in washington, the tea party movement is in town, not in town, down in nashville with their convention. and sarah palin had a big showing there sounding a lot like a presidential candidate, and here is part of what she said. >> this was all part of that hope and change and transparency and now a year later i got to ask the supporters of all that, how is that hopy, changy stuff working out for you? >> if there was ever a time, ed, to question where is sarah palin going, it seems like this. she sounded like a candidate last night. >> well, she was rallying the troops, very well-received possible, and she has an incredible capacity to connect with people and with their concerns. i find myself, david, baffled by some of the consternation about sarah palin sometimes because i find her to be a pretty
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compelling figure and someone obviously who resonated very strongly in that room in nashville. >> but what role does she play in a republican party right now, dee dee, where the gains for republicans in 2009 special elections were won by republicans like scott brown or bob mcdonnell in virginia or chris christie in new jersey. much more moderate democrats than the brand of conservatism they represents. >> but that didn't stop her and the tea party movement last night from taking credit for scott brown's victory and it is interesting because not only did she rally conservative base that may or may not be republican, she went out of her way to say her husband is not a republican and to say that this movement is a warning to both republican and democratic officials that maybe they need to look at what -- how they've been doing business over the last few years. i'm not sure this is exactly where this is going. she's clearly positioning herself as the spokesman if not the leader of the tea party movement, but is it a third party? is it part of the republican party? i don't think that's clear. >> as a movement what impact does it have in the midterms? >> i think it will have a
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significant impact in the midterms. i think a lot of these people are new to the political process. another not republicans or democrats, many of them at this point. they're leery of both parties, but their overwhelming concerns are about debt and spending and government intervention and our economy and higher taxes, and i think at the end of the day as they look at the candidates before them in november, they're going to end up voting for the republican candidate. i believe that's what happened for a lot of folks in massachusetts and other places. >> right, but the question is if a lot of these folks are motivated by the deficit, which we just talked about, this was what "usa today" wrote on friday. the tea partiers seem to be promoting more partisanship, not less. many are rejecting candidates deemed to be too likely to cross over and reach accommodations with democrats. that's a recipe for more debt. this isn't to say an uprising against washington is not merited lawmakers of both parties are simply ignoring the nation's drift toward fiscal suicide. the last one, ross perot's presidential bid in '92, forced
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both parties to focus attention on the deficits which then turned into surpluses. is there a third way that's brewing here? >> i think it's unclear. one of the things we know is structurally it's very hard to create a third party. to get on the ballot and run a credible campaign for president. it's not hard to force politicians to take a different position. there's no question that ross perot forced the country to take debt and deficit more seriously and as a result president clinton passed an economic plan that was a combination of tax cuts and spending cuts that really reassured the financial markets and put us on a path from a $290 billion debt under president bush to a $127 billion surplus at the end of the clinton's term. can that happen again? we'll see. under george w. bush we saw the debt go from $5.7 trillion to -- he added $4.9 trillion to that debt. he nearly doubled it.
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he nearly in eight years did what it took george washington to bill clinton to do. >> it's easy to explain. we had the attacks of seven a9/ and -- >> that's not fair. >> it had a huge impact on the economy, but the fact is president bush's discretionary spending which president obama made a big deal out of the freeze was under 1% when he left office. >> but he had a huge new entitlement. >> and huge new entitlements that are cheaper than the huge new -- >> this debate about deficits is part of what we're talking about. let's talk about the president's agenda. whether it was the winter meeting for the dnc. he said he's not turning his back on health care. but at the same time i spoke to a senior advise they are week who said we're trying to adjust to what the new normal is in washington. what is that going to mean for health care? >> i think it means that health care -- they may be able to get
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some things done where there's some common understanding that these are reforms, that democrats and republicans alike can support, maybe things concerning pre-existing conditions maybe even liability reform even though it's unlikely. there are some areas you can find common ground. i think what it means is they have to talk about jobs and the president got to it in the state of union but it's been a year and they have burned a year talking about a massive government intervention in the private sector in terms of health care and they finally realize most americans out there are worried about their jobs or the economy in general and they have got to get to that and i think that's what you're going to see. >> it's interesting because you also talk inside the white house, they say the view is they have to pass health care before they can go out and win the argument about health care. it make it is difficult for democrats who face re-election today. when the president met with some senators, this is how the associated press summed up the meeting. virtually all the senators who got their hands on a psych row phone face steep re-election
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challenges this year and their moment with the president allowed them to give voice to public dissatisfaction with the economy and washington. senator bayh of indiana, why should the democratic party be trusted? sen link of arkansas, are we willing as democrats to push back on our own party and look for that common ground that we need to work with republicans. >> there's no question this was a difficult moment. it's a bit of a come to jesus moment for the administration and for democrats. and i think that's why you've seen president obama making a much more loud pitch for new job legislation. he's been talking about jobs. he said that's priority one of his administration now, and that's going to have to be a bipartisan bill. the president has acknowledged as much. it's going to include tax cuts and we'll see if the republicans will be for what they're for and will vote for a bill that might help not just the country but help democrats. once you pass a job bill, you have to do something about health care. the president has made clear he's not abandoning health care.
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he's not going to go out there and be the leader. he's going to work behind the scenes as he has to try to push members to pass it. if they don't pass, it i think the president has said what does that say about our ability to govern. >> you get all the downside and none the upside is the view. is the democratic majority in real jeopardy? >> absolutely. i felt for some time that the house majority is at great risk of going republican in november, and i think increasingly you're looking at significant gains in the senate. we just saw this week with senator coats declaring in indiana against evan bayh. we have seen john bozeman going to run in arkansas. beau biden say he's not going to run in delaware. mike castle, it puts it heavily in his favor. across the board we're seeing opportunities for republicans we didn't see certainly six months ago. i think scott brown's election has had a major impact on recruiting. >> that assumes some level of
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support for republican rule which is certainly not evidenced in the polling. >> democrats' losses have not been republicans' gains. i think democrats need to run like they're afraid of losing both houses. that said, this he need to make a strong argument about the economy, about health care. the president needs to do a better job of talking about what will happen if we don't pass health care and after health care passes should it pass, he needs to remind people that their lives will be better because of it. this isn't something that republicans are going to cede without a fight. >> let me make a point in terms of republicans. it's true people aren't self-identifying as republicans in big numbers. it's also true republicans won the governorship in new jersey. won the senate seat in massachusetts. we have a 2 to 4 had been poi-pe which we haven't seen in over a decade. i believe at the end of the day if we get the opportunity to get the majority again and we demonstrate a commitment to
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fiscal responsibility, you will see more people self-identifying as republican. >> thank you both very much. before we go, it is, of course, super sunday, and we all know what that means. sid the kid versus alex the great. the washington capitals take on the stanley cup champions. it's the nhl on nbc at 12:00 noon and, yes, i'm so excited because i will be there. as for that other game, our executive producer betsy fisher would be angry with me if i did not say, go saints. that's all for today. we will be back next week. if it's sunday, it's "meet the press."
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